EMI says it's cancelling the deal, and wants $300,000 it says its owed.

Grooveshark has responded with a 'well, I never liked your hair anyway and your feet smell':

“Grooveshark was recently forced to make the difficult decision to part ways with EMI due to EMI’s currently unsustainable streaming rates and EMI’s pending merger with Universal Music Group, which we consider monopolistic and in violation of antitrust laws. To date, Grooveshark has paid over $2.6 million to EMI, but we have yet to find sustainable streaming rates.”

And, to be honest, you'd suspect that EMI's ire is more about their new owners finding an out from a contract than any real beef.